Labour was accused today of taking a cavalier approach to taxpayers' money after a leaked government report showed that millions of pounds are wasted by the schools department.

Financial efficiency is not a "core responsibility of management at any level", according to the report, which criticises Ed Balls, the secretary of state for children, schools and families, for overwhelming teachers with too many initiatives. Teachers struggle to cope with so many schemes that they find themselves at a "standing in front of a fire hose trying to take a drink", the report claimed.

Richard Handover, the former chairman of WH Smith commissioned by Balls to write the report, says efficiencies of 6% could be introduced to primary and secondary schools' budgets without jeopardising services. The report found:

• £50,000 was spent installing three toilets in a primary school. It should have cost a tenth of that.

• One school spent £35,000 on a photocopier that should have cost £1,000.

• The number of administrative staff in schools has risen 76% from 38,900 in 1997 to 68,500 in 2008. £1.66bn.

The report, leaked to the BBC's Politics Show, said: "We believe it would be possible to apply a 6% efficiency target to whole-school budgets for primaries and secondaries without damaging outcomes."

Handover called for the current 175,600 teaching assistants to be reduced by 40,000. Their training was "often piecemeal". An extra 30,000 teaching assistants should be given extra skills to become "para professional".

Philip Hammond, shadow chief secretary to the treasury, told the Politics Show: "It's a damning indictment of the cavalier attitude this government takes to taxpayers' hard earned money. The report makes it clear significant savings could be made without affecting frontline services."

Vernon Coaker, the schools minister, described the waste highlighted in the report as "isolated" examples.

Balls indicated he had rejected Handover's call for a cut in the number of teaching assistants when he received the report in April. Describing the work as "useful blue-sky thinking", a spokesman said Balls would not pre-empt the School Funding Review and did not want to see fewer teachers or teaching assistants.

But the schools department indicated that the report had helped Balls formulate ideas for efficiency savings, including encouraging comprehensives to form "federations" that shared headteachers.